South Korea plans to pump an extra $11 billion (€8.56 billion) into its economy next year to help fend off the impact of the global financial storm, which is beginning to hit exports - the country's economic lifeblood.
Finance Minister Kang Man-soo said today economic growth could fall to its lowest in more than a decade without the fiscal stimulus, which will need approval by parliament where the pro-government party has a large majority.
His comments came just after the government gave stark proof of the damage from the global economic downturn, announcing that export growth in October had fallen to a 13-month low, worse than analysts had expected.
"If the current situation continues, the economy is expected to grow by around 3 per cent next year. If the global economy shrinks further, it may be difficult to achieve 3 per cent growth," Minister Kang told reporters.
Financial markets have slumped in the face of the global downturn, with both the won and the main KOSPI share index losing around a third of their value since the start of the year in some of the most volatile trading seen since the Asian financial crisis a decade ago which ravaged its economy.
Reuters